The Rock ‘n’ Roll History of the Acronym “SaaS”

We hear it every day. Read about it. Talk about it. But do you know where the hell it even comes from? The term “SaaS” or software-as-a-service was first mentioned in an internal document called “Software as a Service: Strategic Backgrounder” by the Software & Information Industry Association in 2000.

In fact, it was commonly referred back then as the Application Service Provider (ASP). The Software & Information Industry Association’s (SIAA) purpose for developing the backgrounder article was to analyze the current state of the SaaS market, its near-term prospects, and to provide insight to its members who were deeply concerned about the profound impact and change that the SaaS model was bringing forth to more traditional approaches to software delivery. The SIAA article focused on examining the opponents and proponents of the new model and in some ways helping to find a common understanding amongst its members to help plan for what we all now know was the inevitable direction of the industry.

The SIIA was pretty clear on its assessment about the software-as-a-service model capable of providing a “sea change in the software industry.” Interestingly enough, one of the greatest challenges the SIIA believed towards its widespread adoption by the industry was a lack of clarity on defining “software services.”

At the time, the industry was in wide disagreement about how to define “services” and the terminology to describe “application services.” The reason for such heated disagreement was due to the speed at which technology was advancing and the creation of new business models, and their delivery methods. The various acronyms inundated the marketplace at the time like application service provider (ASP), application infrastructure providers (AIPs) internet business service (IBS), business service providers (BSP), solution service providers (SSP) and many more.

The SIAA finally decided to unify them all under one name in order to rid the confusion and hostility overwhelming the industry—by referring the model as software-as-a-service (SaaS). It was defined as a service model, application, or service that is deployed from a centralized data center across a network (Internet, Intranet, LAN, or VPN) that provides access and use based upon a recurring fee. Customers rent, subscribe, are assigned, or are granted access to the applications from a central provider.

Not bad, right? We’ll see what the next technological battlefield of terminology and definition will be soon enough as we continue the SaaS ride.

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